The Justice Department has granted President Trump, his family, and his businesses immunity from ongoing tax inquiries — a potentially lucrative arrangement that could shield the president from significant financial liability.
The provision, quietly inserted as a supplement to a remarkable deal that also created a $1.8 billion compensation fund for Trump allies, protects the president, his relatives, and his businesses from pending audits and tax prosecutions. The one-page document, signed by acting Attorney General Todd Blanche, declares that the government would be “FOREVER BARRED and PRECLUDED from prosecuting or pursuing” pending tax claims against them.
The provision invited immediate criticism, with tax experts raising the possibility that it is illegal. That the addendum was posted without fanfare on the department’s website belied its bare-knuckled audacity. It revealed the determination of Trump and his appointees to push through maximalist measures with minimum outside scrutiny at a moment when they still have uncontested control of government.
The Financial Stakes
Protection from audit could be quite financially beneficial for Trump, who has always said there was no wrongdoing in his tax filings. In 2024, The New York Times reported that a loss in an IRS audit could cost Trump more than $100 million.
It is unclear if that examination has concluded or if Trump, his family members, or affiliated entities are under other audits. IRS procedures call for the mandatory audit of the president’s tax returns annually.
Neither the Justice Department nor the IRS responded to requests for comment. The top lawyer at the Treasury, Brian Morrissey, resigned on Monday after the Justice Department announced the settlement with Trump.
Is It Legal?
Federal law prohibits the president, vice president, and other executive officers from instructing the IRS to start or stop specific audits. But that broad prohibition appears to include a carve-out for the attorney general.
Brandon DeBot, a senior attorney adviser at New York University’s Tax Law Center, said in a statement that the audit protection may still be illegal. “The IRS would need to act to make the release of claims effective, which could raise additional questions about whether there has been unlawful political interference in the audit process,” he said. “The settlement and general release of claims is a breathtaking abuse of the tax and legal system.”
The Backdrop: A $1.8 Billion Fund
The audit protection came as blowback appeared to be mounting over the creation of a separate $1.8 billion “Anti-Weaponization Fund” for Trump allies who claim they were unfairly investigated. Even a few Republican lawmakers, typically wary of incurring Trump’s wrath, voiced concerns.
Senator John Thune, Republican of South Dakota and the majority leader, offered rare criticism of the president, saying he “was not a big fan” of the fund and adding that he did not see a “purpose” to it.
The main agreement indicated that claims would largely be handed out in secrecy, requiring the fund managers to provide the attorney general with a “confidential written report” of those who received any money. The fund would stop processing claims no later than December 1, 2028 — just weeks before Trump is scheduled to leave office.
The Lawsuit That Made It Happen
In January, Trump, along with two of his sons and the Trump family business, sued the IRS for at least $10 billion over the leak of their tax returns during the president’s first term. The Trumps argued that the IRS should have done more to prevent a former contractor from disclosing tax information to The New York Times and ProPublica.
Frank Bisignano, the chief executive of the IRS, signed the original nine-page settlement. The provisions granting Trump immunity from existing audits, however, were signed only by Blanche, who has stepped up to carry out Trump’s campaign of retribution against his enemies.
During an appearance before a Senate appropriations subcommittee on Tuesday, Blanche defended the fund. Senator Chris Van Hollen, Democrat of Maryland, repeatedly accused Blanche of behaving more like a Trump defense lawyer than an independent guardian of the public interest.
Blanche pushed back, asserting that he was “the acting attorney general.” Van Hollen replied, “Mr. Attorney General, you are acting today like the president’s personal attorney, and that’s the whole problem.”
The Bottom Line
The Justice Department has granted President Trump, his family, and his businesses immunity from ongoing IRS audits and tax prosecutions. The provision was quietly added to a deal that also created a $1.8 billion compensation fund for Trump allies. Tax experts say the arrangement may be illegal. Federal law prohibits the president from instructing the IRS to stop audits, but appears to include a carve-out for the attorney general. The top Treasury lawyer resigned after the deal was announced. Senate Majority Leader John Thune offered rare criticism of the president. And acting Attorney General Todd Blanche faced accusations of acting as Trump’s personal attorney rather than an independent public official.
The president sued the IRS. Then his Justice Department settled. And now, Trump and his family are shielded from tax audits that could have cost them more than $100 million.
